Prominent cryptocurrency exchange, Uniswap, along with its community suffered a severe blow as liquidity providers (LPs) of the Uniswap v3 protocol reeled under a major phishing attack resulting in a loss of over $8.1 million worth of Ether.
Phishing attacks have grown exponentially with the burgeoning crypto industry. Scammers are increasingly masquerading as notable companies or reputable people to siphon millions of dollars. In 2021 alone, cybercriminals stole a mammoth $14 billion in crypto which is almost twice the amount heisted in 2000. In February 2022, non-fungible token (NFT) marketplace, OpenSea users, were looted off nearly $1.7 million worth of NFTs.
How did the Attack Happen?
⚠️ As of block 151,223,32, there has been 73,399 address that have been sent a malicious token to target their assets, under the false impression of a $UNI airdrop based on their LP's
Activity started ~2H ago
cc: @Uniswap @etherscan pic.twitter.com/5W51AikFuV
— harry.eth 🦊💙 (whg.eth) (@sniko_) July 11, 2022
On July 11, Metamask security researcher, Harry Denley, warned users on Twitter that 73,399 addresses were sent a malicious ERC-20 tokens to steal their assets. The attack was altered by the scammers to make it seem as though Uniswap was airdropping tokens to platform liquidity providers. The total losses currently stand at $8.1 million, though that figure might be much higher as more information arrives.
Going further, when the users connected their wallets to the contract’s website, which resembled Uniswap, native tokens (ETH), ERC20 tokens, and NFTs (namely Uniswap LP positions) were hijacked from their wallets.
did a large LP get phished?https://t.co/3n6oruM8Hj
the v3 NFTs in 0x09b5 all originated from this wallet which has 16k ETH ($18m) sitting in it
— Sisyphus (@0xSisyphus) July 11, 2022
Popular crypto Twitter user ‘0xSisyphus’, also stated that a “large LP” with around 16,140 ETH, worth $17.5 million, may have also been phished. Uniswap CEO, Hayden Adams, confirmed the phishing attack noting that it is totally separate from the protocol. He tweeted,
“This was a phishing attack that resulted in some LP NFTs being taken from individuals who approved malicious transactions. A good reminder to protect yourself from phishing and not click on malicious links.”
This was a phishing attack that resulted in some LP NFTs being taken from individuals who approved malicious transactions
Totally separate from the protocol
A good reminder to protect yourself from phishing and not click on malicious links https://t.co/aj3Zh8UKqF
— hayden.eth 🦄 (@haydenzadams) July 11, 2022
A Raucous Phase for Uniswap
Connected with the @uniswap team. The protocol is safe.
The attack looks like from a phishing attack. Both teams responded quickly. All good. Sorry for the alarm.
Learn to protect yourself from phishing. Don't click on links. 🙏 pic.twitter.com/FIXebz3iBC
— CZ 🔶 Binance (@cz_binance) July 11, 2022
Binance’s CEO, Changpeng Zhao, caused a disturbance in the crypto markets when he first signalled about the attack, calling it a “potential exploit” of the Uniswap protocol on the ETH blockchain. However, soon after, Zhao, clarified that the attack was part of a phishing attack rather than any issue with the protocol.
Please be aware that there is currently a Phishing scam happening that targets Uniswap V3 LP’s.
It does not look like a Uniswap protocol hack.
No matter what, if you get tokens airdropped to your wallet of ynknown origin – DON’T Interact with them !!!
— Mel 🦇🔊 (@belikewater893) July 11, 2022
According to a Reddit post, the stolen funds were being laundered through mixing service Tornado Cash. Another Twitter user who goes by the name ‘Mel’, urged users not to interact with airdropped tokens from any unknown origin. Mel wrote,
“Please be aware that there is currently a Phishing scam happening that targets Uniswap V3 LP’s. It does not look like a Uniswap protocol hack.”